Day Trading For Beginners - Discover the Crucial Fact You Need Know!
by Monica Hendrix
This article is all about forex day trading for beginners and what you need to know, to preserve your equity and win at forex trading.
The most important fact you need to know is that the odds are stacked against you and longer term, it's impossible to win. Have you seen a tempting day trading system with a track record of gains?
Then you will also find the warning below in the small print which is a sobering thought, showing you how the track record has been manufactured:
"CFTC RULE 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".
All day trading forex courses and systems sold that I have seen have it.
You see some lovely track records, then in the small print, you get the above which simply means the system has never been traded and the track record made up using past data. That's made up KNOWING the closing prices!
Well that's not hard, a child could do it and so could you.
So why doesn't day trading work?
All you need to do is think about the dumb logic it's based on.
We have numerous millions of people all around the world, all with different skill levels, motivations, aims and forex trading strategies and you are going to have to decide, what this vast mass of people are going to do, in just a few hours.
Is it possible?
Of course not.
It's a fact, that all daily volatility is of a random nature and prices can go outside of daily support, resistance, pivot points or any other technical analysis tool you apply.
Look at any forex chart and this is obvious.
Because you can't get the odds on your side, your destined to lose - PERIOD.
The other point you need to keep in mind (if the above is not enough to convince you) is that day trading breaks a fundamental rule of investment:
Run your profits, to cover your losses.
So in day trading, you do keep losses small (and your going to get lots of them) but on the other hand, what does a day trader do if he is lucky enough to have a profit?
Run it? Not a chance - he cuts it!
So you have lots of small losses and marginal wins (now and again when your lucky) and this equates to an equity wipe out long term.
Don't be fooled by all the vendors telling you that you will win, you won't.
You could always ask the obvious question:
If the system is so good, why hasn't it got a real time profitable track record?
You already know the reason why!
You can make money at forex trading big money but you need to get the odds on your side and you need to trade longer term.
If you want a good forex education and to learn currency trading the right way, forget day trading and try long term forex trend following.
Forex markets do trend longer term, you can get the odds on your side and you can win which is more than can be said for forex day trading.
แสดงบทความที่มีป้ายกำกับ Day Trading แสดงบทความทั้งหมด
แสดงบทความที่มีป้ายกำกับ Day Trading แสดงบทความทั้งหมด
วันอังคารที่ 10 มิถุนายน พ.ศ. 2551
วันพฤหัสบดีที่ 17 มกราคม พ.ศ. 2551
Forex trading can be like day-trading
Forex trading can be like day-trading
by Jay Monclif
Forex trading, or foreign currency trading, has become a bit of a craze of late, especially since it is something available to anyone who owns a computer. And anyone who is willing to put in some training time can profit from forex trading.
The forex market finds traders from all around the globe monitoring currency fluctuations, not unlike the way a day trader may monitor a stock's fluctuation on the Dow Jones.
In forex trading, a trader will pair two types of currency, for example the U.S. dollar and the British pound. As it requires more of one currency to purchase another, that currency loses value. Not unlike, stock trading, forex traders try to accumulate currency when it weakens in hopes of selling it when it goes up in value. Forex trading is not unlike the buy low, sell high approach found in stock trading.
The way a trader on the forex market exchange goes about acquiring currency is by giving a bid/ask quote, saying he is willing to buy, for example 1.6 marks per dollar and sell them at 1.625 per dollar. One must be a market trader to have access to this process. So most people who are forex trading on line buy the currency through a bank, where they'll pay a commission, then have to figure the commission paid to the bank into the calculation of their spread, or profit margin, when they sell it.
Forex trading is not an easy path to riches. And some people have lost considerable money in miscalculating the market. With its increased popularity, on some days the forex market exchange can see more than one trillion dollars exchanged. Packages for teaching a new forex trader how to invest in the market can range in price.
by Jay Monclif
Forex trading, or foreign currency trading, has become a bit of a craze of late, especially since it is something available to anyone who owns a computer. And anyone who is willing to put in some training time can profit from forex trading.
The forex market finds traders from all around the globe monitoring currency fluctuations, not unlike the way a day trader may monitor a stock's fluctuation on the Dow Jones.
In forex trading, a trader will pair two types of currency, for example the U.S. dollar and the British pound. As it requires more of one currency to purchase another, that currency loses value. Not unlike, stock trading, forex traders try to accumulate currency when it weakens in hopes of selling it when it goes up in value. Forex trading is not unlike the buy low, sell high approach found in stock trading.
The way a trader on the forex market exchange goes about acquiring currency is by giving a bid/ask quote, saying he is willing to buy, for example 1.6 marks per dollar and sell them at 1.625 per dollar. One must be a market trader to have access to this process. So most people who are forex trading on line buy the currency through a bank, where they'll pay a commission, then have to figure the commission paid to the bank into the calculation of their spread, or profit margin, when they sell it.
Forex trading is not an easy path to riches. And some people have lost considerable money in miscalculating the market. With its increased popularity, on some days the forex market exchange can see more than one trillion dollars exchanged. Packages for teaching a new forex trader how to invest in the market can range in price.
วันจันทร์ที่ 31 ธันวาคม พ.ศ. 2550
Forex Day Trading - Why You Will Never Make Money Day Trading
Forex Day Trading - Why You Will Never Make Money Day Trading
by kelly Price
Long term you won't make money if you try forex day trading, as you can never get the odds in your favor however more traders try day trading than perhaps any other method. Let's look at why it can never work - yet still remains so popular.
Day trading doesn't work simply because all short term volatility is random and prices can and do go anywhere in a day session. If you try and use support and resistance you are going to lose - because volatility is random and these levels are of no use whatsoever - this should be obvious to anyone - but forex day traders don't see it.
You have millions of traders trading trillions of dollars and to say you can measure what this huge mass of people are going to do in a short period of time is absolute nonsense.
So why is day trading so popular?
Quite simply it's a good story and appeals to greedy and naïve investors who are duped by marketing companies selling day trading systems, with track records that show amazing profits but they all have a problem - none of them have track records that are real, they are all simulated knowing the closing prices!
How hard is that?
Anyone would be a millionaire if they knew tomorrows price today - but forex trading is a bit more difficult. When you see a track record of amazing gains look at the small print and you will normally see a disclaimer like this standard CFTC one
"cftc rule 4.41 - hypothetical or simulated performance results have certain limitations. unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".
Put the above disclaimer on a track record and a vendor can say anything they want and of course they do. These track records never lose in hindsight but of course in the brutal world of real trading they get destroyed.
Day traders think that by trading within a day they reduce risk - but of course there is no point in have a small risk to your stop if you have a high probability of it being hit!
Day traders get lots of small losses that simply eat into and destroy their equity.
If their lucky enough to get a profit, they take it quickly which of course breaks the fundamental rule of trading - run your profits, to cover your inevitable losses.
Day traders lose and wonder why but the reason is obvious - they simply can't get the odds in their favor - PERIOD
The Way To Win If you want to win at forex trading you must get the odds in your favor and this means using reliable data. If you like the excitement of trading try forex swing trading, if you are more patient try long term trend following.
Both the above will allow you to trade the odds and enjoy currency trading success so try these methods and do not try forex day trading.
by kelly Price
Long term you won't make money if you try forex day trading, as you can never get the odds in your favor however more traders try day trading than perhaps any other method. Let's look at why it can never work - yet still remains so popular.
Day trading doesn't work simply because all short term volatility is random and prices can and do go anywhere in a day session. If you try and use support and resistance you are going to lose - because volatility is random and these levels are of no use whatsoever - this should be obvious to anyone - but forex day traders don't see it.
You have millions of traders trading trillions of dollars and to say you can measure what this huge mass of people are going to do in a short period of time is absolute nonsense.
So why is day trading so popular?
Quite simply it's a good story and appeals to greedy and naïve investors who are duped by marketing companies selling day trading systems, with track records that show amazing profits but they all have a problem - none of them have track records that are real, they are all simulated knowing the closing prices!
How hard is that?
Anyone would be a millionaire if they knew tomorrows price today - but forex trading is a bit more difficult. When you see a track record of amazing gains look at the small print and you will normally see a disclaimer like this standard CFTC one
"cftc rule 4.41 - hypothetical or simulated performance results have certain limitations. unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".
Put the above disclaimer on a track record and a vendor can say anything they want and of course they do. These track records never lose in hindsight but of course in the brutal world of real trading they get destroyed.
Day traders think that by trading within a day they reduce risk - but of course there is no point in have a small risk to your stop if you have a high probability of it being hit!
Day traders get lots of small losses that simply eat into and destroy their equity.
If their lucky enough to get a profit, they take it quickly which of course breaks the fundamental rule of trading - run your profits, to cover your inevitable losses.
Day traders lose and wonder why but the reason is obvious - they simply can't get the odds in their favor - PERIOD
The Way To Win If you want to win at forex trading you must get the odds in your favor and this means using reliable data. If you like the excitement of trading try forex swing trading, if you are more patient try long term trend following.
Both the above will allow you to trade the odds and enjoy currency trading success so try these methods and do not try forex day trading.
สมัครสมาชิก:
บทความ (Atom)
.jpg)